Methionine Prices Show Downward Trend in China and Europe Amidst Ample Inventories

Methionine prices continued to fall due to adequate inventories and weaker end-consumer demand, with declining new orders, purchasing activity, and sales. Methionine is an important amino acid vital to human and animal bodies. It aids in the production of various protein-containing compounds, as well as sulfur-containing amino acids. The market is divided into food and beverage, pharmaceutical, animal feed, and other end-user industries. Recently, demand for Methionine has been reduced from these end sectors, supporting the downward trajectory.

The Methionine market in Europe and China has mimicked the previous month's trend and remained lower in July, demonstrating no improvement. In particular, the Chinese market did not see a significant transaction increase, as end consumers adopted a hand-to-mouth buying strategy. There is a significant decrease in the number of new orders being placed due to reduced demand from the downstream industries, which has contributed to the decreasing trend in Methionine.

China's economy is suffering from weakening global demand and a slowing domestic economy. The economic slowdown has been driven by deflation, which has resulted in lower consumption and decreased manufacturing output. As per the NBS, the Consumer Price Index (CPI), the main inflation indicator, fell 0.3% in July. China's consumer prices recorded their first monthly decline in over two years in July as a slowdown in domestic spending weighed on China's economic recovery after the coronavirus pandemic. Chinese retailers have been grappling with a sales slump. Retailers who stocked up on goods anticipating a surge in demand following the lifting of pandemic restrictions are now being forced to lower prices.

Methionine prices decreased in Germany due to an economic downturn in the German manufacturing sector due to a decrease in new orders, factory gate prices, input costs, and output prices. This decrease in demand was attributed to a range of factors, including customer reluctance, stock build-ups, and higher interest rates. The economic and geopolitical uncertainties associated with tightened market conditions contributed to a decline in demand. Furthermore, the appreciation of the Euro against the US Dollar led to a decline in exports to other countries, resulting in an increase in Methionine supply in the domestic market and a further drop in prices. Additionally, the European Central Bank (ECB) tightened monetary policy to combat inflation, contributing to a drop in demand.

According to ChemAnalyst analysis, Methionine prices are expected to increase due to an increase in end-consumer demand coupled with sufficient supply. In addition, Adisseo (one of the world's leading feed additives companies) recently announced the construction of a new powder Methionine plant in China, which could further affect the market dynamics in the coming months.